200,000 candidates apply for McKinsey every year and only about 2,000 of them are hired – a 1% success rate. In other words, the selection process at the firm is harder than for Harvard or Stanford’s MBA programmes.
Most applicants are extremely smart, and setting yourself apart in this process can be challenging. A potential strategy to achieve this is to score very high at the McKinsey PST. Indeed, being among the top scorers can be a HUGE advantage.
Scoring 90%+ at the PST can set yourself apart in the recruiting process.
Most candidates think that the PST only determines if you make it to the first round of interviews. In reality, McKinsey also uses your score during your last round of interviews to decide if you are given an offer or not.
If the firm is hesitating between you and other candidates who have done similarly well at their case interviews, McKinsey will likely choose you over others if you scored substantially higher at the PST than they did.
Conversely, if you barely score over the passing grade of 70%+, you will likely have to do extremely well during case interviews to get yourself noticed. In our experience, candidates prepare much more for case interviews than they do for the Problem Solving Test. As a consequence, investing time to get a very high score at the PST can be an extremely efficient differentiating strategy.
McKinsey interviews are much less predictable than the McKinsey PST. Even if you prepare extensively for them, you can always be unlucky and get the odd case for which you will have to completely improvise. On the contrary, the format and types of questions of the PST is determined in advance and there can’t be any surprises on that front.
It is feasible with sufficient preparation.
Scoring very high is feasible with sufficient preparation. It requires being both accurate and extremely fast. To help you in your training, we thought we would share a McKinsey Problem Solving Test sample question with you.
Will you determine the right answer? How long will it take you? The challenge is on!
Try answering the question below accurately and as fast as possible. Leave a comment at the bottom of the blog post with your answer and tell us how long it took you. We will reply to every question in the comment section.
The key is to answer the question without seeing other people’s answers. To do so, scroll down directly to the bottom and leave your answer before reading other candidates’ proposals.
Try this question:
You will find our proposed answer to the question below. Before taking a look at it, make sure you go to the bottom of the page and answer the question by yourself in the comments section. There are only so many opportunities to prepare for the McKinsey Problem Solving Test.
1. Precise vs Estimate
Asking yourself whether you should do precise calculations or not can save you a lot of time when answering McKinsey PST maths questions. An easy way to determine this is to look at the available answers for the question.
If the available answers are close to each other - say within 10% of each other - then precise calculations are very likely required to get to the right result. If on the other hand, the available answers are significantly spaced out from each other then estimates are probably sufficient to find the right answer.
In this case, the available answers are spaced out by 5 years, or about 50% from each other on average. This indicates that the right answer can very likely be found by using estimates rather than precise maths.
2. Calculate total revenue
Total revenue is the addition of revenues from Products A to L. An easy way to get a good estimate of total revenue quickly is to add up the largest numbers first and then the smaller ones together. For instance:
Products B, E, F ≈ 45 + 45 + 40 = 130
Products G, H, I, J, K, L ≈ 5 + 10 + 5 = 20
Products D, C, A ≈ 8 + 9 + 3 = 20
Total revenue = 170
3. Revenue share of product B
25% of $170 million is $42.5 million. The revenue share of product B ($46 million) is therefore close to 25% of the total. To keep things simple, we will use 25% as a proxy in the following steps.
4. Growth rates
The total revenue growth rate is 5%. If product B was also growing at 5% per year, its revenue share would remain about 25%. The growth in revenue share of product B is therefore driven by the difference between its growth rate and the total revenue growth rate: 12% - 5% = 7%.
The revenue share of product B is therefore growing at ~7% per year.
5. Time to double in size
The revenue share of Product B needs to double from 25% to 50%. It therefore needs to grow by 100%.
The Rule of 72 is a useful maths shortcut. It enables you to calculate how much time it takes for a certain quantity to double in size when it is growing at a certain pace. All you need to do is to divide 72 by the annual growth rate and the result will be the number of years required for the quantity to double in size.
72 / 7 ≈ 10 years
It therefore takes about ten years for the revenue share to double from 25% to 50%. And the correct answer is answer B!
How did you do?
Did you find the right answer? Leave a comment below with your thoughts and questions and we will answer them promptly.
If you would like to learn a method to consistently crack the PST you can get started below. More than 80% of students who use our McKinsey PST Training Programme are successful.
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The IGotAnOffer team
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